Andersen Corp. announced today it will sell its Silver Line and American Craftsman brands, plus the rest of its hollow core vinyl window and patio door business, to Ply Gem for $190 million.
The deal brings Ply Gem four Silver Line manufacturing plants and more than 4,000 employees. The $190 million price tag amounts to 10 times Silver Line’s EBITDA (earnings before interest, taxes, depreciation, and amortization) in the 12 months through June. Silver Line had revenues of $440 million in 2017, Ply Gem said in its press release announcing the deal.
“This divestiture is part of Andersen’s broader strategy to sharpen our focus on our Andersen, Renewal by Andersen and specialty brands, continue to make the significant investments required to support our fast-growing, proprietary, Fibrex engineered composite products, and deliver exceptional value to our customers for years to come,” Andersen’s chairman and CEO, Jay Lund, said in a news release.
Ply Gem, meanwhile, said it favored the deal because it will “create a more comprehensive and balanced portfolio across the repair and remodeling and new construction segments,” generate opportunities for synergy in customer service and profitability, and strengthen Ply Gem’s national residential windows platform.
“This transaction is in full alignment with our strategic growth plan,” Gary E. Robinette, Ply Gem’s chairman and CEO, said in the company’s news release. “The addition of the Silver Line business will better balance the mix of end markets that we serve, strengthen our core capabilities and contribute significantly to revenues and earnings. We are confident this will help us achieve synergies and competitive advantages that drive top line sales and enhanced customer value.”
The transaction is expected to close by early in the fourth calendar quarter of 2018, subject to regulatory review and approval.
Anderson bought Silver Line in May 2006. It said at the time it wanted to expand in what then was a rapidly growing market for vinyl windows. Since then, the market has kept growing, but so has the competition and the pressure to cut margins.
